Gold Technical Analysis and Near-Term Outlook
Gold failed to settle above Tuesday’s open and confirm yesterday’s bullish piercing pattern. Gold might be trying to form a bottom, but based upon the wave formations, near-term odds still lean in favor of a decline to challenge the next major objective at $1735. This is the target of the five-wave pattern down from $1919.2. Therefore, once met, a three-wave test of resistance is anticipated. Closing below $1763 will increase odds for a decline to $1754, which then connects to $1735.
Nevertheless, the waves up from $1750.1 warn that a larger test of resistance might take place first. Resistance at $1789 is expected to hold. However, closing above this will call for a test of key near-term resistance at $1802. Settling above $1802 would serve as an early warning that a bottom has been made and call for $1815 and possibly higher in the coming days.
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